CIRJE-F-1093 "Cyclical Part-Time Employment in an Estimated New Keynesian Model with Search Frictions"
Author Name Mukoyama, Toshihiko, Mototsugu Shintani and Kazuhiro Teramoto
Date August 2018
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This paper analyzes the dynamics of full-time employment and part-time employment over the business cycle. We first document basic macroeconomic facts on these employment stocks using the U.S. data and decompose their cyclical dynamics into the contributions of different flows into and out of these stocks. Second, we develop and estimate a New Keynesian search-and-matching model with two labor markets to uncover the fundamental driving forces of the cyclical dynamics of employment stocks. We find that the procyclicality of the net flow from part-time to full-time employment is essential in accounting for countercyclical patterns of part-time employment.

Key Words: Part-time employment; Bayesian estimation; DSGE model; Search,
matching and bargaining.